CraigsList Makes Top-50 Retailer List

The cover story for the STORES.org Favorite 50 online retailers list sees an odd newcomer to the ranks of perennial favorites. We're used to seeing Wal-Mart, eBay and Best Buy at the top of the list but the big surprise is Craigslist debut at No. 25.

Is Craigslist a Retailer?

Interestingly enough, Craigslist's characterization as a retailer is a topic of contention among many retail gurus. The site isn't actually a point of purchase website as we would require of a true online retailer.

Regardless, the STORES list of Favorite 50 online retailers is based upon a a survey of 8,600 customers in June, 2009. The customer is always right!

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Top 10 Online Stores By Volume

People in my work and social circles are often asking me who the top 10 online stores are (and how much they sell). That's a tough question to answer because the reported numbers are often voluntary. Furthermore, the Internet Retailer Guide has only been available for a few years - and it's not free.

Top 10 Online Stores By Volume

The top 10 online retailers, by revenue in 2007:

1. Amazon.com, $14.8 billion
2. Staples, $5.6 billion
3. Office Depot, $4.9 billion
4. Dell, $4.2 billion
5. HP, $3.36 billion
6. OfficeMax, $3.16 billion
7. Apple, $2.7 billion
8. Sears, $2.59 billion
9. CDW, $2.41 billion
10. Newegg.com, $1.9 billion

Source: Internet Retailer Top 500 Guide



Past Top 10 Online Stores By Volume

I worked hard to pull the next numbers together. I finally found the top 10 list from 2000 after a long, exhaustive, 5-minute Internet Search.

The top 10 online retailers, by revenue in 2000:

1. Wal-Mart - 193.3 billion
2. Kroger
3. Home Depot
4. Sears, Roebuck and Company
5. Kmart
6. Albertson's
7. Target
8. JCPenny
9. Costco
10. Safeway

Other Notable Mentions:

46. Barnes & Noble
66. Amazon.com


Online Revenue For The Top 100 Sites:

• 1999 - $963.2 Billion
• 2000 - $1.06 Trillion

Source: Cached Version of About.com Retail Industry News

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Are Coupons Today's Key To Online Sales?

We at First Scribe don't claim to be economists but we know a tough market when we see one. Bloomberg.com reports the Dow Average's Drop into a bear market and many are feeling the pinch.

How is it affecting online sales?

High gas prices can actually be a boon to online revenue. Online retail studies are showing that nationwide, shoppers are increasingly looking at the Internet earlier in the buying process. Unfortunately, we are seeing numbers down on the Internet as well.

So, what to do about sinking online sales numbers?

If summer is your season and your numbers are down, we don't need to tell you that it's time to move. Here's a few quick ideas to turn some numbers:

1. Create a coupon with a limited-time offer. Put a big-old button that allows them to email it to a friend. Maybe you give them a better deal for each friend they email (up to a point, obviously). The idea is to get your site under as many noses as possible. A coupon is a tangible item they print/hold during an online purchase.
   
   
2. Offer free shipping or free in-store pickup. Gas prices are a quantifiable issue and free shipping speaks right to the problem. Ten percent off is a great idea but free shipping will save them a trip in the car.
   
   
3. Send 2 email blasts. Split your database in half; send a shipping offer to one half and a percentage off to the other half. Then, measure the results and hit the weak half with the opposite offer.
   
   
4. Make sure everything on your website is in stock and ready to go. People visit your website to buy - not to browse your stock issues. If it's out of stock, get it off the site.
   
   
5. Finally, put something on sale and make sure people know it's On Sale. Get the featured item on your home page change to another item if you don't sell any within 1-2 business days.
   

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Estimating Online Sales

Nearly every eCommerce project that we bid on comes down to one final question:

How much will we sell online?

It's impossible to guarantee any sort of a projection but we have a formula that will get us in range. Our estimates are a combination of average conversion rates times current traffic levels and a bit of intuition. This estimate isn't possible without an honest traffic number.

Estimating Online Sales

We can make a solid estimate of online sales once we have a number for Avg. Monthly Unique visitors in hand. The more months we have to work from, the better - this gives us an idea of growth/decline rate and seasonality.

Take this average number of visitors and multiply it by a conversion rate you feel comfortable with using. This will give you an estimate of the average number of people who will purchase from you because of your site. Call this number Total Buys.

Online conversion rates can easily vary from 1% to 7%. We rely heavily on Omniture SiteCatalyst for analytics and we feel comfortable with starting at 3% conversion for a new site with a solid design.

Remember That Some Products Don't Sell Online

Here's where you need to trust your intuition. There are products that simply don't sell online and these products may not be obvious. If the timeliness of the product is so immediate that next-day delivery is too late then you will have a tough time selling it online.

Average Order Size

Two more variables need to be added to the formula: Avg. Order Size and another conversion percentage based on the Avg. Order Size.

Ask your prospective client for their average order size at the brick and mortar store(s). This number is often spot-on for web orders. If you don't have this number, pull an average price of all products available from the site and adjust that number about 30% down. This adjustment will accommodate for a higher percentage of small items over the bigger-ticket units.

If this Avg. Order Size is over $500, multiply your Total Buys number by 10%. If the Avg. Order Size is less than $500, multiply Total Buys by 40%.

Multiple eCommerce studies have shown - Of the visitors who start shopping online and purchase from you, better than 60% will purchase offline. The number increases to 90% if the purchase is over $500. This number should be referred to as the Online Buys Percentage.

The Final Estimate Formula

Total Buys = (Avg. Monthly Unique * Conversion Rate)

Estimated Revenue = (Total Buys * Avg. Order Size) * Online Buys Percentage


Remember: This is an estimate!

Keep in mind, this is an estimate based upon current traffic numbers and a fairly low conversion rate. We often bracket the current traffic numbers with a 50 and 100% average traffic increase over the next year.

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2nd Wind Exercise Equipment Chooses First Scribe

First Scribe is proud to announce their latest partnership with nationally recognized 2nd Wind Exercise Equipment.

First Scribe's industry leading Design and Internet Marketing services will allow 2nd Wind to combine their 4 existing websites into one singularly branded, eCommerce presence. First Scribe's programming team will also integrate the 2nd Wind online shopping cart to their existing NetSuite Accounting and CRM systems.

The 2nd Wind and First Scribe management teams agree that the sales projection for the new eCommerce presence will surpass the expected first-year revenue of a 2nd Wind brick and mortar store. Both teams have high expectations and they will use Omniture SiteCatalyst analytics to measure the effectiveness of their efforts.

First Scribe Owner & CEO, Jay Perrill is excited for the new business partnership saying, "The acquisition of the 2nd Wind Exercise account is a great move for us. This firmly establishes First Scribe's reputation as a premium web design firm."

About 2nd Wind Exercise Equipment
2nd Wind (http://www.2ndwindexercise.com) is passionate about fitness solutions for their clients and continually changes the way the world looks at exercise. Founded in Minneapolis in 1991 as a specialty used exercise equipment dealer, 2nd Wind grew rapidly and is now the premier specialty Fitness dealer in United States with 100 Midwest locations in 10 states. 2nd Wind has a philosophy of "Customized Fitness Solutions" and an environment that educates, motivates and develops individual programs to achieve and obtain measurable, realistic goals while optimizing their customer’s chance for a successful, life changing fitness experience. 2nd Wind is the exclusive dealer for many top brand manufacturers including; Life Fitness, Parabody, True, Hoist, PaceMaster, Vision, Octane, and a host of others. 2nd Wind also offers a free VIP program that provides personal training, healthy recipes, fitness articles and exclusive discounts on top home fitness equipment.

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Does Yahoo Prefer Yahoo Cart Sites?

Does Yahoo prefer shopping carts in the Yahoo store environment?

We've heard this issue in quite a few circles for 2 specific arguments:

· The Yahoo engine prefers the Yahoo cart.

· A Yahoo cart won’t work in Google SEO.

While both of these points may have an amount of truth to them, neither of these arguments appear to us to be *true enough* for concern. That is to say, we aren’t concerned with the Yahoo search engine, per se. And we have Yahoo carts that perform nicely in Google.

Google is the engine of choice

Google holds the Lion's share of market value and that trend grows every year. For our clients’ sites, across product vertical, Average revenue per visitor is higher for visits from Google vs. Yahoo.

We will work through the Yahoo cart as if it’s just another website. However, we migrate people off the Yahoo cart at every opportunity. The cart is difficult to use; it is a quantifiable hindrance to Google SEO; and the backend admin area is difficult.

Does Yahoo Prefer Yahoo Cart Sites?

Not necessarily. The Cart seems to have nothing to do with this question. The answer boils down to how well the site is optimized in general. Here is a Yahoo cart site that we are watching. Their site ranks better in Google than it does in Yahoo:

	Google	Yahoo	Change
Name	1	1	0
	2	2	0
Keyword 1	5	Not in first 30.	26
Keyword 2	10	Not in first 30.	21
	14	Not in first 30.	17
Keyword 3	18	2	(16)
	23		7
Keyword 4	1	Not in first 30.	30
	2	Not in first 30.	29
Keyword 5	4	Not in first 30.	26
Keyword 6	Not in first 30.	21	(9)
Primary Keyword	1	14	13
Keyword 7	23	11	(12)
Keyword 8	12	8	(4)
	13		17
Keyword 9	11	4	(7)
Keyword 10	6	3	(3)
	15		15
Keyword 11	2	3	1
Keyword 12	6	2	(4)
			147

Summary:

This client is concerned about moving from the Yahoo cart to an eCommerce Platform but they are worried that their revenue will suffer. Yahoo is their number 2 source of revenue and they don't want to lose that share.

We don’t in any way doubt that a large portion of their business is derived from Yahoo visitors. The Yahoo demographic matches nicely with people who would go out and buy their product line.

What is the real question?

The real question is different than they think…

It would be really nice to know if revenue per visitor is higher from Yahoo versus Google. If the average is the same, then open up Google traffic and forget about Yahoo.

Yahoo traffic and revenue might well suffer with a push in Google. But the net gain should be a significant increase in revenue.

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